Mining permit backlog leaves U.S. dependent on China for widely used rare minerals

Strategic minerals that are essential components in green and high technology such as hybrid cars, iPods and solar panels are readily available in the U.S. but efforts to mine the elements are being stalled by bureaucrats for years, industry officials say.

“The United States is heavily reliant on foreign countries such as China for critical minerals that are the building blocks of our economy and imperative to renewable energy development, military technology and the manufacturing of nearly all of our electronic devices,” said Rep. Doc Hastings (R-Wash.), chairman of the House Resources Committee.

There are 15 such rare earth minerals worth more than $6 trillion, including terbium, yttrium and dysprosium that are found throughout the U.S. To increase access, Republican lawmakers are supporting legislation called the Strategic and Critical Minerals Production Act that they say tackles the highest hurdle of getting the needed permits to begin mining operations.

Hall Quinn, president of the National Mining Association, said at a recent House hearing on the bill that it often takes 10 years to get a mining permit. “The length, complexity and uncertainty of the permitting process are the primary reasons investors give for not investing in U.S. minerals mining,” Quinn said.

“Delaying permits for mining projects is not a new problem. What is new is the growing awareness of its implications for our nation, particularly in a highly competitive world economy in which the demand for minerals continues to grow, especially in fast growing economies led by China and India,” Quinn said.

The bill authored by Rep. Mark Amodei (R-Nev.) would reverse a 30-year trend of increased reliance on foreign countries and fierce competition to gain access to the needed resources. “In the 2012 ranking of countries for mining investment, the United States ranked last, tied with Papua New Guinea, in permitting delays,” Amodei said.

“Decade-long permitting delays are standing in the way of high-paying jobs and revenue for local communities. This bill would streamline the permitting process to leverage our nation’s vast mineral resources while paying due respect to economic and environmental concerns,” Amodei said.

Lawmakers say the United States is completely reliant on China, and in addition to the threats to national security of not being self-reliant in this area, the delays in approving mining permits also costs good-paying jobs that are instead being filled overseas.

The risk of scarcity is expected to rise so significantly that it will lead to supply instability and potential disruptions in the next five years, according to the National Mining Association. If that happens, price increases in the commodities as well as the goods associated with it will not be far behind.

The U.S. Geological Survey reported in 2010 that 13 million tons of known deposits of rare earth elements have been located in 14 states including Alaska, California, Florida and New York. However, China accounts for 96 percent of the world’s supply, the agency said.

The Toyota Prius uses more of the mineral than any other consumer product, including lanthanum and cerium in the battery, yttrium in the component sensors, dysprosium and terbium in the motor and generator and neodymium in the headlight glass.

The new bill is just getting off the ground in the House and it is unclear how much member support it will garner.